HTLV-I Tax1, in addition to the protein's role of viral and cellular gene regulation in the infected cell, is released from the infected cell to act as an extracellular cytokine. It has been demonstrated that purified, extracellular Tax1 protein induced the nuclear accumulation of NF-kB binding activity in lymphoid cells. Since HTLV-I infection causes increased levels of lymphotoxin (TNF-beta) and immunoglobulin secretion, the interaction of NF-kB proteins from Tax1- stimulated cells with the TNF-~ and immunoglobulin kappa (Igk) light chain genes has been analyzed. Tax1 induction of NF-kB occurred in the presence of cyclo-heximide. Tax1 stimulation did not result in increased levels of NF-kB or c-rel RNA. These results indicate that new synthesis of NF-kB proteins was not required for induction of NF-kB binding activity. Using the Igk NF-kB binding site as a probe, two distinct NF-kB gel shift complexes were induced by the Tax1 protein. Analysis of the gel shift complexes suggest that they are regulated by distinct inhibitor proteins. The NF-kB proteins that interacted with the consensus NF-kB binding sites in the Igk and TNF-beta promoter were distinct. Tax1 stimulation led to increased levels of TNF-beta and Igk mRNA as measured by reverse transcription and PCR analysis. These results represent the first experimental evidence that extracellular Tax1 can regulate the expression of endogenous cellular genes.